Imperial Brands (LSE:IMB) has reaffirmed its outlook for fiscal 2026, expecting low single-digit growth in combined tobacco and next-generation product (NGP) revenue during the first half. Performance is being supported by firm pricing and continued expansion of its NGP portfolio across Europe and the AAACE region. The company anticipates slightly higher adjusted operating profit for the full year, with stronger momentum in the second half as pricing benefits in combustible products take effect and NGP volumes scale further, even as it accepts some market share decline in key markets in favour of higher value sales.
The group continues to target at least high single-digit growth in earnings per share alongside free cash flow of no less than £2.2 billion. Leverage is expected to remain at the lower end of its net debt-to-EBITDA target range. As part of its capital return strategy, Imperial has already completed £0.7 billion of its £1.45 billion share buyback programme for FY26 under its ongoing “evergreen” repurchase framework.
Strategically, the company is progressing its 2030 transformation plan, including a long-term collaboration with Capgemini to modernise its IT systems and supply chain. While execution remains on track, management flagged geopolitical uncertainty in the Middle East and foreign exchange movements as potential headwinds to earnings.
From an investment perspective, the company benefits from stable financial performance, supportive technical indicators, and a relatively attractive valuation. However, ongoing management of debt levels and cash flow will be important, and regulatory pressures remain a key consideration for the sector.
More about Imperial Brands
Imperial Brands is a global tobacco and next-generation products company with a portfolio spanning traditional cigarette brands and reduced-risk alternatives. Its offerings include the blu vaping range, Pulze heated tobacco devices, and modern oral nicotine products such as Skruf and Zone. The group operates across Europe, the United States, and the AAACE region, focusing on a consumer-led, data-driven strategy while maintaining strong cash generation and consistent shareholder returns.
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